Explanation:

Formal merchant banking activity in India was originated in 1969.
Merchant banking can be defined as a skill-oriented professional service provided by merchant banks to their clients, concerning their financial needs, for adequate consideration, in the form of fee.
Merchant banking helps in reinforcing the economic development of the country, by acting as a source of funds and information to the business entities.
In India, the functions of the merchant bankers are governed by the Securities and Exchange Board of India (SEBI) Regulations, 1992.